UNITED
STATES




SECURITIES
AND EXCHANGE COMMISSION




WASHINGTON, D.C.
20549




FORM
10-K/A







Amendment
No. 2 to Form 10-K






ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE




SECURITIES
EXCHANGE ACT OF 1934




FOR THE FISCAL YEAR ENDED DECEMBER
31, 2007




Commission File No.
333-124837




SILVER PEARL ENTERPRISES,
INC.




Nevada
                  
                  45-0538522(State or
      Jurisdiction of Incorporation or Organization)
                  
                  (I.R.S.
      Employer Identification No.)




1541 E.
Interstate 30, Rockwall, Texas 75087


(PRINCIPAL EXECUTIVE
OFFICES)




972
/ 722-4411


(ISSUER'S
TELEPHONE NUMBER)




Securities
registered under Section 12(b) of the Exchange Act: None




Securities
registered under Section 12(g) of the Exchange Act: Common Stock, $0.001 par
value




Check
whether the issuer is not required to file reports pursuant to Section 13 or 15
(d) of the Exchange Act.[ ]




Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes [X] No [ ]




Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 under the Exchange Act). Yes [X] No [ ]




As of
February 25, 2008, the aggregate market value of the common stock held by
non-affiliates based on the closing sale price of Common Stock was $68,520. For
the purposes of the foregoing calculation only, all directors, executive
officers, related parties and holders of more than 10% of the issued and
outstanding common stock of the registrant have been deemed
affiliates.




As of
September 30, 2008, the issuer had 5,696,800 shares of common stock outstanding.
Documents incorporated by reference: none Transitional Small Business Disclosure
Format (check one): Yes [  ] No [X]















Amendment
No. 1 to the Annual Report on Form 10-K




For the
Year Ended December 31, 2007







EXPLANATORY
NOTE





This Form
10-K/A is being filed by Silver Pearl Enterprises, Inc., to amend the Company’s
Annual Report on Form 10-K for the year ended December 31, 2007 that was
originally filed with the Securities and Exchange Commission on March 31,
2008.





This Form
10-K/A amends and restates, pursuant to ITEM 601(b)(31) of Regulation S-B, the
Exhibit 31.1, Certification of the Principal Executive Officer and Exhibit 31.2,
Certification Principal Financial Officer, which adds the introductory language
of paragraph 4 and the language paragraph 4(b).





In
addition, as part of the 10-K/A, the Amendment also includes the report signed
on behalf of the registrant by our principal executive officer, our principal
financial officer and our sole director.





Except
with respect to the above changes, this Amendment does not modify or update any
other disclosures set forth in the Original or First Amended
filing.








2


PART I.





FORWARD-LOOKING
STATEMENTS





This
annual report on Form 10-K includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, which we refer
to in this annual report as the Securities Act, and Section 21E of the
Securities Exchange Act of 1934, as amended, which we refer to in this annual
report as the Exchange Act. Forward-looking statements are not statements of
historical fact but rather reflect our current expectations, estimates and
predictions about future results and events. These statements may use words such
as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “predict,” “project”
and similar expressions as they relate to us or our management. When we make
forward-looking statements, we are basing them on our management’s beliefs and
assumptions, using information currently available to us. These forward-looking
statements are subject to risks, uncertainties and assumptions, including but
not limited to, risks, uncertainties and assumptions discussed in this annual
report. Factors that can cause or contribute to these differences include those
described under the headings “Risk Factors” and “Management Discussion and
Analysis and Plan of Operation.”





If one or
more of these or other risks or uncertainties materialize, or if our underlying
assumptions prove to be incorrect, actual results may vary materially from what
we projected. Any forward-looking statement you read in this annual report
reflects our current views with respect to future events and is subject to these
and other risks, uncertainties and assumptions relating to our operations,
results of operations, growth strategy and liquidity. All subsequent written and
oral forward-looking statements attributable to us or individuals acting on our
behalf are expressly qualified in their entirety by this paragraph. You should
specifically consider the factors identified in this annual report which would
cause actual results to differ before making an investment decision. We are
under no duty to update any of the forward-looking statements after the date of
this annual report or to conform these statements to actual results.








ITEM
1.                      DESCRIPTION
OF BUSINESS





We were
incorporated on May 4, 2004 in the State of Texas as Silver Pearl Enterprises,
Inc. (herein referred to as “Silverpearl” or “the Company”) in order to sell
furniture and decorating accessories for both residential and commercial uses.
For the first part of the year, we purchased our furniture through companies
that import directly from manufacturers in China, and some decorating items from
local importers and distributors. We ceased operations at the end of August and
sold our subsidiary, which held substantially all our assets.





Sales for
the year ended December 31, 2007 and 2006 were $35,558 and $97,738,
respectively. Before we ceased operations, we sold residential and office
furniture, and other decorating accessories, some of which are imported and some
of which we obtained from local importers and distributors.








ITEM
2.                      DESCRIPTION
OF PROPERTY





The
Company rented a 2,980 square foot facility on a three year lease at the rate of
$1,500 per month from a company controlled by a shareholder.  The
lease expired in July
2007 and was notrenewed.   The
Company now shares an office with the President, at no charge, since we have no
operations.








3








ITEM  3.                      LEGAL
PROCEEDINGS





The
company is not involved in any legal proceedings.








ITEM
4.                      SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS





The
Company did not submit any matters to a vote to the security holders during
2007.





4


PART
II





ITEM
      5.
            MARKET
      FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDERS
      MATTERS





The
Common Stock is currently quoted on the NASDAQ bulletin board under the symbol
“SVPE.”





The
following table sets forth the quarterly high and low bid prices for the Common
Stock for 2007.  The prices set forth below represent interdealer
quotations, without retail markup, markdown or commission and may not be
reflective of actual transactions.





Fiscal
      2007
            
            High
            
            
            LowFirst
      Quarter
            
            $
            0.50
            
            
            $
            0.50Second
      Quarter
            
            $
            1.25
            
            
            $
            0.15Third
      Quarter
            
            $
            0.15
            
            
            $
            0.15Fourth
      Quarter
            
            $
            0.15
            
            
            $
            0.15





Shareholders





As of
December 31, 2007, there were approximately 117 record holders of the Common
Stock. This number excludes any estimate by the Company of the number of
beneficial owners of shares held in street name, the accuracy of which cannot be
guaranteed.





Dividends





The
Company has not paid cash dividends on any class of common equity since
formation and the Company does not anticipate paying any dividends on its
outstanding common stock in the foreseeable future.





Warrants





The
Company has no warrants outstanding.





ITEM
6.    SELECTED FINANCIAL DATA





Not
Required as a Smaller Reporting Company





ITEM
7.  MANAGEMENT DISCUSSIONS AND ANALYSIS OR PLAN OF
OPERATION





The
following discussion should be read in conjunction with our consolidated
financial statements provided in this annual report on Form 10-K.  Certain
statements contained herein may constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements involve a number of risks, uncertainties and other factors that could
cause actual results to differ materially, as discussed more fully
herein.





The
forward-looking information set forth in this annual report is as of the date of
this filing, and we undertake no duty to update this information. More
information about potential factors that could affect our business and financial
results is included in the section entitled “Risk Factors” of this annual
report.









5





SUMMARY
OF 2007





Sales in
2007 decreased steadily due to major construction on roads in our area. As
expenses continued to drain our resources, we decided to cut our losses in our
main line of business and instead focus on finding an acquisition
candidate.





Results
for the Year Ended December 31, 2007





Revenues
for the year ended December 31, 2007 were $35,558 compared to $97,738 for the
year ended December 31, 2006.





Cost of
goods sold were $13,781 for 2007 and $75,548 for 2006, thus giving us a gross
profit of $21,777 or 61% in 2007 and $22,190 or 23% in 2006.  Our
gross profit went up year-over-year as we sold higher margin products in 2007
than in 2006.





Total
operating expenses for the year were $80,916 for 2007 and $425,400 for 2006.
Included in the 2006 total is a non-cash expense for consulting services of
$265,000 for consulting fees.  Adjusting for that charge, our expenses
in 2006 were $160,400 or a decrease of $79,484. The decrease is due to a
reduction in advertising and other general operating expenses as we ceased
operations and sold the operating assets in August 2007.





Net loss
for the year ended December 31, 2007 was $176,240 compared to the loss for 2006
of $344,649.





The
Company is now focused on finding an acceptable acquisition or merger candidate.
As of the date of this 10-K, we have not entered into any discussions or
negotiations with any company, whether formal or informal.





ITEM
8.                     
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA





The
financial statements of the Company, together with the independent auditors'
report thereon of The Hall Group CPAs appear on pages F-1 through F-13 of this
report





ITEM
9.                      CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANICAL
DISCLOSURES





None.





ITEM
9A.                   CONTROLS
AND PROCEDURES





Evaluation of Disclosure
Controls and Procedures


Disclosure
controls and procedures include, without limitation, controls and procedures
designed to ensure that information required to be disclosed by an issuer in the
reports that it files or submits under the Securities Exchange Act of 1934, as
amended (the "Act") is accumulated and communicated to the issuer's management,
including its principal executive and principal financial officers, or persons
performing similar functions, as appropriate to allow timely decisions regarding
required disclosure. It should be noted that the design of any system of
controls is based in part upon certain assumptions about the likelihood of
future events, and there can be no assurance that any design will succeed in
achieving its stated goals under all potential future conditions, regardless of
how remote.  As of the end of the period covered by this Annual Report, we
carried out an evaluation, under the supervision and with the participation of
our President, also serving as our Chief Financial Officer, of the effectiveness
of the design and operation of our disclosure controls and procedures. 
Based on this evaluation, our President has concluded that the Company’s
disclosure controls and procedures are not effective because of the
identification of a material weakness in our internal control over financial
reporting which is identified below, which we view as an integral part of our
disclosure controls and procedures.








6




Changes in Internal Controls
over Financial Reporting


We have
not yet made any changes in our internal controls over financial reporting that
occurred during the period covered by this report on Form 10-K that has
materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.




Management’s Annual Report
on Internal Control Over Financial Reporting


Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control
system was designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes, in accordance with generally accepted accounting principles. Because
of inherent limitations, a system of internal control over financial reporting
may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate due to change in conditions, or that the degree of compliance with
the policies or procedures may deteriorate.




Our
management conducted an evaluation of the effectiveness of our internal control
over financial reporting using the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control—Integrated Framework. Based on its evaluation, our management concluded
that there is a material weakness in our internal control over financial
reporting. A material weakness is a deficiency, or a combination of control
deficiencies, in internal control over financial reporting such that there is a
reasonable possibility that a material misstatement of the Company’s annual or
interim financial statements will not be prevented or detected on a timely
basis.




The
material weakness relates to the lack of segregation of duties in financial
reporting, as our financial reporting and all accounting functions are performed
by xternal accountants who may not always get full information and therefore
something is not recorded appropriately.  Our President does not possess
accounting expertise and our company does not have an audit committee. 
This weakness is due to the company’s lack of working capital to hire additional
staff.  To remedy this material weakness, we intend to engage another
accountant to assist with financial reporting as soon as our finances will
allow.




This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial
reporting.  Management’s report was not subject to the attestation by the
Company’s registered public accounting firm pursuant to temporary rules of the
SEC that permit the Company to provide only management’s report in this annual
report.




The
Company’s management carried out an assessment of the effectiveness of the
Company’s internal control over financial reporting as of December 31, 2007. The
Company’s management based its evaluation on criteria set forth in the framework
in Internal Control—Integrated Framework issued by the Committee of Sponsoring
Organizations of theTreadway Commission. Based on that assessment, management
has concluded that the Company’s internal control over financial reporting was
not effective as of December 31, 2007.











7






PART
III.





ITEM
10.                                DIRECTORS
AND EXECUTIVE OFFICERS OF REGISTRANT





As of
December 31, 2007, the following persons serve as directors and officers of the
Company.





Denise
      D. Smith
            52
            Chief
      Executive Officer, President, Chief Financial Officer and
      Director





Denise D. Smith. Ms.
Smith graduated from Oklahoma State University with a degree in Advertising and
Public Relations. She held various sales positions selling advertising for
brochures, magazines and a television station. These positions required her to
interact with business owners and help them develop an advertising and marketing
plan for their business and working with local and national advertising agencies
in selling advertising for their clients. This entailed describing the different
advertising avenues which gave her an expertise in the advertising and marketing
area. She also was required to develop territories and generate new business for
her employers. After working successfully in these sales positions she took time
to raise a family. Since June 4, 2004, she has been the sole officer and
director of Silver Pearl Enterprises, Inc.








ITEM
10.                                EXECUTIVE
COMPENSATION





Our
executive officer received $-0- in 2007 and$5,100 in
2006 in compensation from the Company.





ITEM
      12.
            SECUIRTY
      OWNERSHIP OF MANANGEMENT AND BENEFICIAL
OWNERS








As of
December 31, 2007 the following persons or entities known to the Company to own
5% or more of the Company's Voting Stock:






Title/relationship
                to
      Issuer
              
              Name
      of Owner
              
              Amount
      owned
                Before
      offering
              
              PercentPresident,
      Secretary and Director
              
              Denise
      D. Smith
              
              4,000,000
              
              70.22%7.02%Shareholder
              
              Art
      Xpectations, LLC
              
              400,000Shareholder
              
              VMP
      Enterprises, LLC
              
              360,000
              
              6.32%Shareholder
              
              TriPoint
      Capital Advisors, LLC
              
              480,000
              
              8.43%All
      officers, directors, and 5% shareholders as a group
              
              
              
              5,240,000
              
              91.99%








8





ITEM
      12.
            CERTAIN
      RELATIONSHIPS AND RELATED PARTY
TRANSACTION





None.






ITEM
13.                             
 Exhibits and Reports on Form 8-K




(a)
            Exhibits


No.
            Description31.1
            Certification
      of the Company’s Principal Executive Officer pursuant to Section 302 of
      the Sarbanes-Oxley Act of 200231.2
            Certification
      of the Company’s Principal Financial Officer pursuant to Section 302 of
      the Sarbanes-Oxley Act of 200232.1
            Certification
      of the Company’s Principal Executive Officer and Principal Financial
      Officer pursuant to 18 U.S.C. Section 1350, as adopted to Section 906 of
      the Sarbanes-Oxley Act of 2002.




ITEM
14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES




(1) AUDIT
FEES




The
aggregate fees billed for professional services rendered by our auditors, for
the audit of the registrant's annual financial statements and review of the
financial statements included in the registrant's Form 10-K or services that are
normally provided by the accountant in connection with statutory and regulatory
filings or engagements for the years ended December 31, 2007 and 2006 was
$13,500 and $2,000 respectively.




(2)
AUDIT-RELATED FEES




NONE




(3) TAX
FEES




NONE




(4) ALL
OTHER FEES




NONE




(5) AUDIT
COMMITTEE POLICIES AND PROCEDURES




Audit
Committee Financial Expert





The
Securities and Exchange Commission has adopted rules implementing
Section 407 of the Sarbanes-Oxley Act of 2002 requiring public companies to
disclose information about “audit committee financial experts.”  As of the
date of this Annual report, we do not have a standing Audit Committee.   The functions of the
Audit Committee are currently assumed by our Board of Directors. 
Additionally, we do not have a member of our Board of Directors that qualifies
as an “audit committee financial expert.”  For that reason, we do not have
an audit committee financial expert.




















9


SIGNATURES





Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this Report on Form 10-K to be signed on its behalf by the
undersigned, thereunto duly authorized.








SILVER
PEARL ENTERPRISES, INC.





By:





/s/  Denise D.
Smith


Denise D.
Smith


Sole
Member of the Board of Directors





Dated: October 8,
2008








Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.








/s/  Denise
D.Smith


Denise D.
Smith


Sole
Member of the Board of Directors








/s/  Denise D.
Smith


Denise D.
Smith


Chief
Executive Officer








/s/ Denise D.
Smith


Denise D.
Smith


Chief
Financial Officer








/s/  Denise D.
Smith


Denise D.
Smith


Chief
Accounting Officer





Dated:
October 8, 2008





10


REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM








To the
Board of Directors and Management of


Silver
Pearl Enterprises, Inc.


Rockwall,
Texas





We have
audited the accompanying balance sheet of Silver Pearl Enterprises, Inc. as of
December 31, 2007 and the related statements of operations, cash flows and
stockholders’ equity for the years ended December 31, 2007 and
2006.  These financial statements are the responsibility of the
Company’s management.  Our responsibility is to express an opinion on
these financial statements based on our audit.





We
conducted our audit of these financial statements in accordance with the
standards of the Public Company Accounting Oversight Board (United
States).  Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe
that our audit provides a reasonable basis for our opinion.





We were
not engaged to examine management’s assertion about the effectiveness of Silver
Pearl Enterprises, Inc.’s internal control over financial reporting as of
December 31, 2007 and, accordingly, we do not express an opinion
thereon.





In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Silver Pearl Enterprises, Inc. as
of December 31, 2007, and the results of its operations and its cash flows for
the years ended December 31, 2007 and 2006 in conformity with accounting
principles generally accepted in the United States of America.





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note 8 to the
financial statements, the Company has suffered significant losses and will
require additional capital to develop its business until the Company either (1)
achieves a level of revenues adequate to generate sufficient cash flows from
operations; or (2) obtains additional financing necessary to support its working
capital requirements.  These conditions raise substantial doubt about
the Company’s ability to continue as a going concern.  Management’s
plans in regard to these matters are also described in Note 8.  The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.











/s/  The Hall
Group, CPAs


The Hall
Group, CPAs


Dallas,
Texas





March 21,
2008

















11














SILVER PEARL ENTERPRISES, INC.Balance
      SheetDecember
      31, 2007ASSETSCurrent
      AssetsCash
      and Cash Equivalents
            
            $
            863Total
      Current Assets
            
            
            863Other
      AssetsNote
      Receivable
            
            
            47,953Total
      Other Assets
            
            
            47,953TOTAL
      ASSETS
            
            $
            48,816LIABILITIES
      AND STOCKHOLDERS' EQUITYCurrent
      LiabilitiesAccounts
      Payable
            
            $
            25,334Due
      to Related Parties
            
            
            16,500Revolving
      Line of Credit
            
            
            28,202Total
      Liabilities (All Current)
            
            
            70,036Stockholders'
      EquityPreferred
      Stock, $.001 par value, 20,000,000 shares authorized,0
      shares issued and outstanding
            
            
            0Common
      Stock, $.001 par value, 50,000,000 shares authorized,5,696,800
      shares issued and outstanding
            
            
            5,697Additional
      Paid-In Capital
            
            
            555,453Retained
      Earnings (Deficit)
            
            
            (582,370
            )Total
      Stockholders' Equity (Deficit)
            
            
            (21,220
            )TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            48,816






The
accompanying notes are an integral part of these financial
statements.







12





SILVER PEARL ENTERPRISES, INC.Statements
      of IncomeFor
      the Years Ended December 31, 2007 and 20062007
            
            
            2006REVENUES
            
            $
            35,558
            
            
            $
            97,738COST
      OF SALES
            
            
            13,781
            
            
            
            75,548GROSS
      PROFIT
            
            
            21,777
            
            
            
            22,190OPERATING
      EXPENSESAdvertising
            
            
            8,327
            
            
            
            33,223Consulting  Services
            
            
            0
            
            
            
            265,000Contract
      Services
            
            
            5,547
            
            
            
            9,986Depreciation
            
            
            10,981
            
            
            
            14,160Licenses
      & Fees
            
            
            4,618
            
            
            
            11,734Office
      Expenses
            
            
            7,311
            
            
            
            3,876Payroll
      Expenses
            
            
            12,759
            
            
            
            0Professional
      Fees
            
            
            11,227
            
            
            
            0Rent
      - Related Party
            
            
            10,500
            
            
            
            19,233Other
      Operating Expenses
            
            
            9,646
            
            
            
            68,188TOTAL
      OPERATING EXPENSES
            
            
            80,916
            
            
            
            425,400NET
      OPERATING INCOME (LOSS)
            
            
            (59,139
            )
            
            
            (403,210
            )OTHER
      INCOME (EXPENSE)Interest
      Income
            
            
            1,079
            
            
            
            33Interest
      Expense
            
            
            (1,679
            )
            
            
            (819
            )Loss
      on Sale of Assets
            
            
            (46,384
            )
            
            
            0Unrealized
      Loss from Marketable Securities
            
            
            0
            
            
            
            (1,969
            )TOTAL
      OTHER INCOME (EXPENSE)
            
            
            (46,984
            )
            
            
            (2,755
            )NET
      (LOSS) BEFORE INCOME TAXES
            
            
            (106,123
            )
            
            
            (405,965
            )Provision
      for Income Taxes (Expense) Benefit
            
            
            (70,117
            )
            
            
            61,316NET
      INCOME (LOSS)
            
            $
            (176,240
            )
            
            $
            (344,649
            )Beginning
      Retained Earnings (Deficit)
            
            
            (406,130
            )
            
            
            (61,481
            )ENDING
      RETAINED EARNINGS (DEFICIT)
            
            $
            (582,370
            )
            
            $
            (406,130
            )EARNINGS
      PER SHAREWeighted
      Average of Outstanding Shares
            
            
            5,696,800
            
            
            
            4,826,145Income
      (Loss) for Common Stockholders
            
            $
            (0.03
            )
            
            $
            (0.07
            )












The
accompanying notes are an integral part of these financial
statements.





13





SILVER PEARL ENTERPRISES, INC.Statements
      of Cash FlowsFor
      the Years Ended December 31, 2007 and 20062007
            
            
            2006CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      Income (Loss)
            
            $
            (176,240
            )
            
            $
            (344,649
            )Adjustments
      to reconcile net income to net cashprovided
      by operating activities:Depreciation
            
            
            10,981
            
            
            
            14,160Loss
      on Disposition of Assets
            
            
            46,384
            
            
            
            0Decrease
      in Accounts Receivable
            
            
            0
            
            
            
            3,522Decrease
      in Inventory
            
            
            67,082
            
            
            
            3,809Decrease
      in Deposits
            
            
            1,500
            
            
            
            0(Increase)
      Decrease in Deferred Tax Benefit
            
            
            70,117
            
            
            
            (61,316
            )Increase
      in Due from Related Parties
            
            
            16,500
            
            
            
            0(Decrease)
      Increase in Accounts Payable
            
            
            (13,956
            )
            
            
            29,674Net
      Cash Provided (Used) by Operating Activities
            
            
            22,368
            
            
            
            (354,800
            )CASH
      FLOWS FROM INVESTING ACTIVITIESAcquisition
      of Note Receivable
            
            
            (47,953
            )
            
            
            0Disposition
      of Fixed Assets
            
            
            (4,440
            )
            
            
            0Purchase
      of Fixed Assets
            
            
            0
            
            
            
            (32,188
            )Net
      Cash (Used) by Investing Activities
            
            
            (52,393
            )
            
            
            (32,188
            )CASH
      FLOWS FROM FINANCING ACTIVITIESCommon
      Stock Issued for Cash
            
            
            0
            
            
            
            335,750Increase
      in Line of Credit
            
            
            23,801
            
            
            
            0Payments
      on Note Payable
            
            
            (403
            )
            
            
            (24,335
            )Net
      Cash Provided by Financing Activities
            
            
            23,398
            
            
            
            311,415NET
      (DECREASE) IN CASH AND CASH EQUIVALENTS
            
            
            (6,627
            )
            
            
            (75,573
            )CASH
      AND CASH EQUIVALENTS AT BEGINNING OF YEAR
            
            
            7,490
            
            
            
            83,063CASH
      AND CASH EQUIVALENTS AT END OF YEAR
            
            $
            863
            
            
            $
            7,490SUPPLEMENTAL
      DISCLOSURESCash
      Paid During the Year for Interest Expense
            
            $
            0
            
            
            $
            819








The
accompanying notes are an integral part of these financial
statements.


14





SILVER PEARL ENTERPRISES, INC.Statement
      of Changes in Stockholders' EquityFor
      the Years Ending December 31, 2007 and 2006RetainedCommon
      Stock
            
            
            Paid-In
            
            
            EarningsShares
            
            
            Amount
            
            
            Capital
            
            
            (Deficit)
            
            
            Totals2006Beginning
      Stockholder's Equity
            
            
            5,025,300
            
            
            $
            5,025
            
            
            $
            220,375
            
            
            $
            (61,481
            )
            
            $
            163,919Issuance
      of Common Stockfor
      Cash
            
            
            671,500
            
            
            
            672
            
            
            
            335,078
            
            
            
            
            
            
            
            335,750Net
      (Loss)
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (344,649
            )
            
            
            (344,649
            )Stockholders'
      Equity at December 31, 2006
            
            
            5,696,800
            
            
            $
            5,697
            
            
            $
            555,453
            
            
            $
            (406,130
            )
            
            $
            155,0202007Net
      (Loss)
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (176,240
            )
            
            
            (176,240
            )Stockholders'
      Equity at December 31, 2007
            
            
            5,696,800
            
            
            $
            5,697
            
            
            $
            555,453
            
            
            $
            (582,370
            )
            
            $
            (21,220
            )







The
accompanying notes are an integral part of these financial
statements.







15




Silver Pearl Enterprises, Inc.


Notes to the Financial Statements


December 31, 2007









NOTE 1 –
NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES





Nature of Activities,
History and Organization:





Silver
Pearl Enterprises, Inc. (The “Company”) operates as a retailer of furniture and
framed art.  The Company is located in Rockwall, Texas and was
incorporated on May 4, 2004 under the laws of the State of Texas.





The
Company redomiciled to Nevada effective February 28, 2007, upon which 20,000,000
shares of preferred stock with a par value of $.001 were
authorized.  In addition, the Company increased its authorized common
shares to 50,000,000 with a par value of $.001.





As
discussed in Note 2, the Company sold all of their operating assets during 2007
in exchange for a note receivable.





Significant Accounting
Policies:





The
Company’s management selects accounting principles generally accepted in the
United States of America and adopts methods for their
application.  The application of accounting principles requires the
estimating, matching and timing of revenue and expense. It is also necessary for
management to determine, measure and allocate resources and obligations within
the financial process according to those principles.  The accounting
policies used conform to generally accepted accounting principles which have
been consistently applied in the preparation of these financial
statements.





The
financial statements and notes are representations of the Company’s management
which is responsible for their integrity and objectivity. Management further
acknowledges that it is solely responsible for adopting sound accounting
practices, establishing and maintaining a system of internal accounting control
and preventing and detecting fraud.  The Company's system of
internal  accounting control is designed to assure, among other items,
that  1) recorded  transactions  are
valid;  2) valid  transactions  are
recorded;  and  3)
transactions  are  recorded in the proper  period
in a timely  manner to produce financial  statements which
present fairly the financial  condition,  results of
operations  and cash  flows of
the  Company  for
the  respective  periods  being
presented.





Basis of
Presentation:





The
Company prepares its financial statements on the accrual basis of
accounting.















16






Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007





NOTE 1 –
(CONTINUED)





Cash and Cash
Equivalents:





Cash
      and cash equivalents includes cash in bank with original maturities of
      three months or less are stated at cost which approximates market value,
      which in the opinion of management, are subject to an insignificant risk
      of loss in value.





Inventory:





Inventory
      is comprised of goods purchased for resale; therefore, the Company has no
      raw materials or work in process.  The Company uses the specific
      identification and FIFO (“First In, First Out”) methods for inventory
      tracking and valuation.  Inventory is stated at the lower of
      cost or market value.





Earnings (Loss) per
Share:





Earnings
(loss) per share (basic) is calculated by dividing the net income (loss) by the
weighted average number of common shares outstanding for the period
covered.  As the Company has no potentially dilutive securities, fully
diluted earnings (loss) per share is equal to earnings (loss) per share
(basic).





Use of
Estimates:





The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures.  Accordingly, actual
results could differ from those estimates.





Revenue
Recognition:





The
Company recognizes revenue from the sale of products in accordance with the
Securities and Exchange Commission Staff Accounting Bulletin No. 104 ("SAB
104"), "Revenue Recognition in Financial Statements." Revenue will be recognized
only when all of the following criteria have been met:





·
            Persuasive
      evidence of an arrangement exists;


·
            Ownership
      and all risks of loss have been transferred to buyer, which is generally
      upon shipment;


·
            The
      price is fixed and determinable;
and


·
            Collectibility
      is reasonably assured.









17






Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007





NOTE 1 –
(CONTINUED)





All
inventory is picked up by the customer or shipped to customers FOB shipping
point.  The risk of loss transfers to the customer at the time of pick
up or shipment.  Currently all revenue is generated from the sale of
products and no revenue is earned from services rendered.





Revenue
is recorded net any of sales taxes charged to customers.





Cost of Goods
Sold:





Cost of
Goods Sold includes direct material costs and incoming and outgoing
freight.





Recently Issued Accounting
Pronouncements:





The
Company  does not
expect  the  adoption  of  recently  issued  accounting
pronouncements  to have a significant  impact on the
Company’s  results of  operations, financial position or
cash flow.  See Note 9 for a discussion of new accounting
pronouncements.





Comprehensive
Income:





SFAS No.
130, "Reporting Comprehensive Income", establishes standards for reporting and
display of comprehensive income and its components in a full set of
general-purpose financial statements.  For the years ended December
31, 2007 and 2006, the Company had no items of other comprehensive income.
Therefore, the net loss equals comprehensive loss for the years then
ended.








NOTE 2 – SALE OF
      ASSETS





On
      August 31, 2007, the Company sold all of their operating assets, including
      all inventory and fixed assets.  The purchaser also assumed
      certain operating liabilities.  A loss of $46,384 was recognized
      on the sale.





The
      Company received a $47,953 note receivable in exchange for the
      assets.   The note bears interest at 9%, with ten interest
      only payments of $359 beginning October 15,
      2007.   Beginning on July 15, 2008, principal and interest
      payments of $1,525 are due based upon a three year
      amortization.     There is no prepayment
      penalty.





18






Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007







NOTE 3 – DUE TO RELATED
PARTY





At
December 31, 2007, the Company owed $16,500 in rent to Dynacap Holdings Ltd.,
LLC (“Dynacap”).     A shareholder who is also the
spouse of the Company’s Chief Executive Officer, is also a member of
Dynacap.








NOTE 4 – LINE OF
      CREDIT





The
      Company entered into an amended and restated revolving credit arrangement
      on March 1, 2005 with a credit limit of
      $50,000.   Collateral for the loan includes all of the
      assets and business interests, as well as all of the common stock that the
      Chief Executive Officer and Chief Financial Officer own (4,000,000
      shares).  The loan has an interest rate of 5% per annum,
      compounded monthly and was due on April 1, 2007.   The note
      is currently payable upon demand.  Upon
      the occurrence of an event of default, Lender may attach and apply any
      profits accrued by the Company, to cure the default or to apply on account
      of any indebtedness under the revolving credit arrangement due and
      owing.  At December 31, 2007, the balance owed on the revolving
      credit arrangement was $28,202.








NOTE 5 –
      EQUITY





The
Company is authorized to issue 20,000,000 preferred shares at a par value of
$0.001 per share.   At December 31, 2007, no shares were
outstanding.





The
Company is authorized to issue 50,000,000 common shares at a par value of $0.001
per share. These shares have full voting rights.  At December 31,
2007, there were 5,696,800 shares outstanding.








19






Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007





NOTE 6 – INCOME
      TAXES





The
Company follows FASB Statement Number 109, Accounting for Income
Taxes.Deferred income taxes reflect the net tax effects of
(a) temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for income tax reporting
purposes, and (b) net operating loss carry forwards.  For Federal
income tax purposes, the Company uses the cash basis of accounting, whereas the
accrual basis is used for financial reporting purposes.  In addition,
certain assets are charged to expense when acquired under Section 179 of the
Internal Revenue Code for income tax purposes.  The cumulative tax
effect at the expected tax rate of 25% of significant items comprising the
Company’s net deferred tax amounts as of December 31, 2007 and 2006 are as
follows:





12/31/07                                12/31/06





Deferred tax assets attributable
to:


Prior
years                                                                           $
116,327                                $   8,801


Tax benefit for current
year                                              32,864                                61,316





Total deferred tax
benefit                                                    $
149,191                               $ 70,117





Valuation
Allowance:                                                          $(149,191)              $         0





Net Deferred Tax
Asset                                                     
$           0                                
$ 70,117





Components
of the current provision (benefit) for taxes on income for the current year are
as follows:




12/31/07                            
12/31/06





Income tax before extraordinary
item:


Tax provision (benefit) on
current year operations      $  70,117                             
$(61,316)





Net provision
(benefit)                                        $  70,117$(61,316)





The
realization of deferred tax benefits is contingent upon future earnings and, as
of December 31, 2007 has been fully reserved.








20




Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007









NOTE 7 – COMMITMENTS
      AND CONTINGENCIES





The lease
for the Company’s retail space expired in July 2007 and was not
renewed.   As the Company does not have any future minimum rental
obligations or any other commitments at December 31, 2007.





Rent
expense was $10,500 and $19,233 for the years ended December 31, 2007 and
2006.












NOTE 8 –FINANCIAL CONDITION
      AND GOING CONCERN









The
Company has an accumulated deficit through December 31, 2007 totaling $582,370
and had negative working capital of $69,173.  Because of this accumulated
deficit, the Company will require additional working capital to develop its
business operations.  The Company intends to raise additional working
capital either through private placements, public offerings and/or bank
financing. There are no assurances that the Company will be able to either
(1) achieve a level of revenues adequate to generate sufficient cash flow from
operations; or (2) obtain additional financing through either private placement,
public offerings and/or bank financing necessary to support the Company’s
working capital requirements.  To the extent that funds generated from any
private placements, public offerings and/or bank financing are insufficient, the
Company will have to raise additional working capital.  No assurance can be
given that additional financing will be available, or if available, will be on
terms acceptable to the Company.  If adequate working capital is not
available, the Company may not be able to continue its operations.




The
Company sold all of its operating assets during 2007, and is not generating any
revenue to offset continuing expenses to operate the Company.  The
Company is currently seeking an acquisition candidate.   These
conditions raise substantial doubt about the Company's ability to continue as a
going concern.  The financial statements do not include any adjustments
relating to the recoverability and classification of asset carrying amounts or
the amount and classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.










21




Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007





NOTE 9 – RECENT ACCOUNTING
PRONOUCEMENTS





In June
2003, the Securities and Exchange Commission (“SEC”) adopted final rules under
Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”), as amended by SEC
Release No. 33-8760 on December 15, 2006.  Commencing with the Company’s
Annual Report for the year ending December 31, 2008, the Company is required to
include a report of management on the Company’s internal control over financial
reporting. The internal control report must include a statement of management’s
responsibility for establishing and maintaining adequate internal control over
financial reporting for the Company; of management’s assessment of the
effectiveness of the Company’s internal control over financial reporting as of
year-end and of the framework used by management to evaluate the effectiveness
of the Company’s internal control over financial reporting. Furthermore in the
following year the Company’s independent accounting firm has to issue an
attestation report separately on the Company’s internal control over financial
reporting on whether it believes that the Company has maintained, in all
material respects, effective internal control over financial
reporting.





In July
2006, the FASB issued FASB Interpretation No. 48, Accounting for
Uncertainty in Income Taxes (FIN 48). FIN 48 clarifies the accounting for
income taxes by prescribing a minimum probability threshold that a tax position
must meet before a financial statement benefit is recognized. The minimum
threshold is defined in FIN 48 as a tax position that is more likely than
not to be sustained upon examination by the applicable taxing authority,
including resolution of any related appeals or litigation processes, based on
the technical merits of the position. The tax benefit to be recognized is
measured as the largest amount of benefit that is greater than fifty percent
likely of being realized upon ultimate settlement. FIN 48 must be applied to all
existing tax positions upon initial adoption. The cumulative effect of applying
FIN 48 at adoption, if any, is to be reported as an adjustment to opening
retained earnings for the year of adoption.   FIN 48 is effective
for the Company’s year-end 2007,  but is
not  expected  to have a material  impact on our
consolidated  financial  statements,  with
the  possible  exception  of  certain
disclosures  relative  to our net  operating loss
carryovers  and the  related valuation
allowance.





In 2006,
the Financial Accounting Standards Board issued the following:





- SFAS
No. 155:Accounting for
Certain Hybrid Financial Instruments





-
SFAS No. 156: Accounting for Servicing of Financial Assets





-
SFAS No. 157: Fair Value Measurements





-
SFAS No. 158: Employers’ Accounting for Defined Benefit Pension and Other
Postretirement Plans








22






Silver Pearl Enterprises, Inc.
 Notes to the Financial Statements
 December 31, 2007




NOTE 9 –
(CONTINUED)





In 2007,
the Financial Accounting Standards Board issued the following:





-
SFAS No. 159: The Fair Value Option for Financial Assets and Financial
Liabilities; Including an amendment of FASB Statement No. 115





-
SFAS No. 141: (Revised 2007), Business Combinations





-
SFAS No. 160: Noncontrolling Interest in Consolidated Financial
Statements





Management
has reviewed these new standards and believes that they have no impact on the
financial statements of the Company.




























23